We have always been interested in the way businesses have evolved and with that, management paradigms that govern the tools used to manage the business and people. What's a business? Well, whether it is called an enterprise, a firm or a corporation, its purpose is to serve the customer. To do that the business entity needs to find a value proposition, organize resources (people and materials) and put that into a framework with a management structure that hopefully works! However as we well know there are continual changes in the business environment, driven mainly by changing consumer needs and expectations. The changes in customer expectations, either from needs or lifestyles, directly impact the type of products and services that appear and disappear from the marketplace. It is really up to the management of the company to catch these changes and adapt.
The pace of change is accelerated by technology. Smaller companies, especially technology ones, seem better equipped to capitalize on the changing business environment. We decided to probe a little deeper into the reasons for this and wanted to share our thoughts on entrepreneurship since much of debate on management practices dwell on tools rather than looking at what we feel are more fundamental issues.
After all, one sees entrepreneurship in all parts of the world--developed to undeveloped, north to south, in the Silicon Valley to a small village in India without electricity. Clearly entrepreneurship existed long before any formal management practice and therefore must have significant merit.
We often read of new entrepreneurs building companies and achieving success against incumbents, but equally through creating new market opportunities based on customer needs which they are able to meet. Entrepreneurs have several traits, but one that is important is the ability to learn. Let us elaborate. Learning means to be clear about their capabilities (and that of their organizations) but also learning about the needs of the customers, both present and future. There are several definitions for learning styles which we will not delve into, suffice to say that the ability to listen is a critical element of learning. Taken at a larger and broader level, many enterprises have missed out on changing consumer demands because of the inability to listen, to customers as well as internal voices.
Today we live in a rapidly changing environment brought on by technology advances, perhaps most visible on the internet, which delivers news, services and gives us access to products. We are familiar with many currently used technologies that touch our daily lives including the pc, mobile phone and tablet. Most have been founded in the last 40 years. Samsung Electronics, although founded in 1969, gained visibility (and profitability) with their Galaxy range of mobile phones. Other technology companies that come to mind (and the year they were founded) are: Microsoft (1975), Apple (1976), Amazon (1994), Google (1998), Facebook (2004), YouTube (2005), Spotify (2006).
The rapid growth of these companies is quite remarkable. The often quoted statistic of reaching 50 million users is worth repeating. The time it took to reach this number of users is worth looking at: Radio--38 years, TV-13 years, Internet--4 years, iPod--3 years, Facebook--2 years. What does this mean about the times we live in? Prof Gary Hamel says clearly that the pace of change is...